The Miami real estate market is heating up with an influx of Latin American buyers making cash purchases of luxury homes. Many luxury developers are seeing their still unfinished buildings sell out floor after floor, largely to foreign investors. Buyers from Brazil and other Latin American countries are used to paying cash for real estate, instead of the typical American practice of putting down 25% to 40% and financing the remainder. Most of the new construction is being paid for as buyers make quarterly payments insuring their home will be 90% paid for when construction is complete.
While many worry the current boom is just a repeat of the last bubble, the presence of foreign buyers signals a change from the last cycle. The influx of cash makes this boom much more sustainable because it is not leveraged, the likelihood of collapse is minimized. Additionally, the current crop of buyers are purchasing second or third homes, and not primary residences.
The type of homes being purchased is different too; one example of the new construction is the fabulous One Thousand Museum tower, designed by Pritzker Prize winning architect, Zaha Hadid. Her building is raising the bar on luxury, convenience, and amenities. Suites in her state-of-the-art building will come equipped with the ability to control lighting, video, sound, and even the shades with the touch of a button.
Of course money is flowing into Miami from more places than just Latin America. When new units of Brickell House were made available half were sold within 90 days, many of the buyers were from Russia, China, and Western Europe. All the international buyers are drawn to Miami for its beauty and international flair. They are drawn to residences that are not only fashionable, but also built with the latest in smart home technologies.
Because these buyers are not buying a primary residence, they want homes designed to be secure when they are away, and well equipped to entertain when they are in town. Luxury no longer is defined just by elegance, but also by ease of use. The latest additions to Miami’s condominium boom allow residents to control almost everything in the unit from a smart phone or tablet, all while being totally secure.
While some skeptics remain about the latest boom in Miami, foreign investment in both residential and commercial real estate continues to grow. The latest sign of the foreign investment trend is the beginnings of a Miami based tech sector, with firms targeting Latina American customers setting up shop in the city. As this sector grows it will only increase demand for the already sizzling market for luxury homes equipped with smart home technologies.